Philips spins off TriMedia team

Philips has spun off its TriMedia media processor operation as a separate business backed by the Dutch consumer electronics giant itself and Sony. TriMedia Technologies will be based in Silicon Valley - with an eye to a Nasdaq launch, presumably - and marks the latest move by an chip company to target the sort-of-emerging Internet set-top box market. TriMedia's gameplan is to develop and license media processor cores to consumer electronics companies. This is, of course, what it was doing while it just a division within Philips, and by its own account done a reasonable job of it - "as part of Philips, we have made tremendous progress with TriMedia", admitted Philips president Cor Boonstra. So why spin TriMedia off? The official line is that the move has made room for Sony's investment and that it will somehow allow TriMedia to work more quickly and for a broader range of customers. That's probably not far from the truth. Philips has been offering TriMedia products for some time now - back in 1996, Apple was intending to build the technology into its Power Mac line, but abandoned the plan when Motorola came up with its PowerPC 740 (aka G3) chip - but it presumably feels that its consumer electronics competitors are less likely to opt for the chip if its development under direct control of a rival. And, as we say, Philips is sure to have considered the IPO opportunities the spun-off operation now offers. The template here is Siemens' decision to split off its semiconductor division, Infineon, with an eye to an IPO, which finally took place earlier this year. TriMedia (the company) will initially focus on versions of the VLIW TriMedia chip for "networked digital television appliances". Both Sony and Philips have obtained licences to use their technology on behalf of their semiconductor operations, which will supply their parents respective digital TV and Net appliance divisions. How much Sony has paid for the licence and its investment in TriMedia Technologies was not revealed - Philips simply said it will "work to finalise definitive agreements soon", so while Sony's involvement can be taken as read, the two companies are still haggling over the price. ®